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CCI Divergence BB Forex Trading Strategy

Amandeep Sonewane | Aug. 30, 2019
CCI Divergence BB Forex Trading Strategy

You can now download the CCI Divergence BB Forex Trading Strategy for free on AtoZ Markets indicators gallery.

This strategy is based on reading the market correctly on a fresh trend and entering on retracements based on the CCI and Bollinger band indicator present withing the trading strategy. 

Knowing that the CCI tends to hover around the +100 or -100 on a trending market environment, we will be looking for a condition wherein it pierces over these figures indicating a probable start of a fresh trend or momentum. This should then be followed by a hover around this area, then a retrace to the zero levels. The retrace should then be our entry point as this could be the area where the price would resume the trend.

Forex Indicators:

  • Bollinger Bands
  • 5 period Smoothed Moving Average set to High
  • 5 Period Smoothed Moving Average set to Low
  • Fibonacci Pivots THV

Timeframe: 1-hour chart and above

Currency Pair: any

Trading Session: any

How to trade with CCI Divergence BB Forex Trading Strategy?

Buy Trade Rules.

  • Check if the SMMA channel is above the middle Bollinger Band, if so, then the market is in an uptrend.
  • See it on a 4-hour chart.
  • Look at the 30-minute chart and wait for the price to approach a Support area.
  • If there are no price action patterns to trade, check to see if there is a divergence present between Price and the CCI/BB/SMMA window on the 30 minute time frame.
  • If either of the above criteria is met, check that there is high volume, that the Volume bar is forming significantly higher or consecutively higher peaks.
  • If these conditions are met, enter a new buy trade position as soon as the candlestick pattern or divergence pattern has completed.
  • Stop loss must be set below the most recent swing low.
  • Trail your stop using the SMMA channel or the middle Bollinger Band.
  • You can also exit manually when the Bollinger Band on the CCI begins to contract.

Sell Trade Entry Rules

  • Check if the SMMA channel is below the Middle Bollinger Band, if so, then the market is in a downtrend.
  • You must determine the trend. refer to the 4-hour chart.
  • Look at the 30-minute chart and wait for the price to approach a Resistance area.
  • If there are no price action patterns to trade, check to see if there is a divergence present between Price and the CCI/BB/SMMA window on the 30 minute time frame.
  • If either of the above criteria is met, check that there is high volume, that the Volume bar is forming significantly higher or consecutively higher peaks.
  • If these conditions are met, enter a new trade position as soon as the candlestick pattern or divergence pattern has completed.
  • Stop loss must be set at the most recent swing high.
  • You can use trail your stop using the SMMA channel or middle Bollinger Band.
  • The manual exit is also helpful, just refer to the Bollinger Band on the CCI (first indicator window) when it begins to contract.

How to download and install an indicator?

In order to install the indicator on your MT4 platform, you need to follow these steps:

  1. Click on “Download Indicator” button located at the top right corner of the screen.
  2. Save the file to your computer.
  3. Extract and move the files into MT4>Indicator folder of the MetaTrader4 software file directory.
  4. Restart your Metatrader platform.
  5. Navigate to “Indicators.”
  6. And select “CCI Divergence BB Forex Trading Strategy” template to apply it on the chart.

Note: This indicator was developed by T. Morris. AtoZ Markets does not carry any copyrights over this trading tool.

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.